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UNITED STATES DEPARTMENT OF AGRICULTURE 



BULLETIN No. 770 

Contribution from the Bureau of Markets 
CHARLES J. BRAND, Chief 





SU^'^J'U 



Washington, D. C. 



January 29, 1919 



MOTOR TRANSPORTATION FOR RURAL 
DISTRICTS.* 

By J. H. Collins, Investigator in Market Surveys. 



CONTENTS. 



Page. 

field for the motor truck 1 

Preliminary survey of the field of 

operation _ ..__ _. 5 

Advance estimate of operating costs 9 

Gasoline, oil and grease 11 

Drivers' wages 11 

Depreciation 12 

Interest on investment _ _ -12 

Repairs - - _ 13 

Tires _ 13 

Garage Rent _ __ _ 14 

Taxes, license and insurance 14 

Overhead expenses 14 

selection of operating equipment 15 

Size of truck 15 

Body equipment _ ..._ 16 

18 

.- - 18 



Tire equipment 

)etermination of rates 



Page. 

Collection and delivery arrangements 20 

Farm-to-Farm collection _ gl 

Cross roads collection 21 

Central assembling points 21 

Delivery methods 22 

Collection of money _ 23 

Keeping cost records _ 23 

Utilization of the farm truck 25 

The return or supplementary load 26 

The central terminal 26 

Business arrangements for stabilizing 
the business of the rural motor opera- 
tor 28 

The standard bill of lading 28 

Insurance on loads carried by motor 

truck 29 

Limiting factors 31 

Conclusions 32 



A FIELD FOR THE MOTOR TRUCK. 

The motor truck as a medium for the carriage of farm products is 
low assuming a permanent place in the general scheme of transpor- 
tation. It was to be expected that the motor truck would find its 
greatest usefulness in solving the problem of the "short haul," one 
)f the most difficult problems which has confronted transportation 
Experts during the last decade. The steady growth of our larger 
:enters of population and their increasing demands for larger quantities 
)f food have stimulated the development of producing areas adjacent 

Acknowledgements are due to Mr. Robert H. Black, Assistant in Marketing, who 
issisted materially in the preparation of the insurance policy provisions included in this 
bulletin, to various members of the New York and Philadelphia Underwriters' Associations, 
vho reviewed and criticised these insurance policy provisions, and to the Secretary of the 
Philadelphia Truck Owners' Association, who criticised the proposed bill of lading. 



e 






2 BULLETIN NO. JJO, U. S. DEPARTMENT OF AGRICULTURE «) /« (p 

to these consuming centers. These producing areas have been pushed 
further and further from the centers of population by the encroach- 
ment of the city proper. Gardeners and dairy farmers who, a few 
years ago, were faced with a short haul to the nearby market, now 
find the horse-drawn vehicle of other days entirely inadequate to 
cover the increased distance to market. Here the motor truck has 
offered itself as a transportation medium capable of working effec- 
tively within a much wider radius than the horse and wagon. The 
development of rail facilities for the short haul has not kept pace 
with the development of crop producing districts near the larger 
centers of population. The rapid growth of the truck manufacturing 
business during the past five years in itself would have directed the 
attention of manufacturers to rural territory as a profitable sales field. 

Summing up, it will be seen that three general causes have con- 
tributed to the exploitation of the motor truck industry in rural terri- 
tory. These causes, as we have noted above, are substantially as 
follows : ( i ) the growth of our larger cities and the consequent develop- 
ment of nearby producing areas to provide for part of the food needs 
of these cities; (2) the failure of the railroads to keep pace with the 
expansion of their short haul business; (3) the development of the 
motor truck manufacturing interests and the consequent extension of 
their sales campaigns. The crisis in the transportation field, brought 
about by the national war emergency, has afforded stimulus to the 
development of rural motor transportation more powerful than any 
other general influence. Doubtless the motor truck, in any event, 
would have established itself as a factor in the rural field. Ordinarily 
this establishment would have been a slow process, involving the many 
preliminary steps customary in introducing a new method of transpor- 
tation. War conditions precipitated action by creating a very unusual 
demand for transportation facilities of all kinds. Persons interested 
in the motor truck found the field made ready by emergency condi- 
tions over which no individual or group of individuals had control. It 
has been necessary only to develop the field of action properly. Such 
development necessitates or presupposes a certain familiarity with the 
problem as a whole. A suspicion that such familiarity did not exist 
among those interested in developing rural motor routes was borne out 
by preliminary investigations, initiated by the Bureau of Markets. An 
attempt was made to conduct a general preliminary survey of rural 
motor routes established or in process of establishment. The general 
purpose of the survey was to secure basic information regarding the 
desirability of establishing such routes, the methods undertaken by the 
beginners in this field, and the measure of success which had been 
attained during the early period of operation. 

Material collected in the survey mentioned above shows considerable 

* _ 

iJ^f • Q3h mm it 

*-•"■ 2929, 



MOTOR TRANSPORTATION FOR RURAL DISTRICTS 3 

differences in the plans adopted by the average inexperienced operator. 
The word "inexperienced" is used advisedly in view of the fact that 
the motor truck is a newcomer in the field of transportation and there 
has not yet been time for many of the important preliminary problems 
to be worked out and a general understanding of possibilities secured. 
Investigations show that there are five general classes engaged in rural 
hauling on a schedule basis. This classification is about as follows : 
(i) The farmer who hauls for his neighbor or for the community 
as well as for himself. In many cases such persons have purchased 
motor trucks and have afterwards found that their own business was 
not sufficient to justify the maintenance of such equipment. By 
arranging to care for part of the haulage needs of their neighbors, 





Fig. 1. — The cabbages and cucumbers in this truck load will travel 20 miles to Buffalo, 
N Y., and arrive in good condition. The wire netting all around holds a large 
load in place. 

they have made their investment a profitable one, and unconsciously 
have materially helped the local transportation problem of their com- 
munities. 

(2) The regular local truck operators with limited capital, whose 
income is derived largely from their motor trucking business. Some 
of these persons are small farmers who have embarked in a new busi- 
ness and are willing to devote exclusive attention to the development 
of local motor routes. 

(3) The local automobile or truck agencies that have initiated a 
motor route as a side line. In some cases the establishment of these 
routes has been for advertising purposes, the dealers feeling that a 
practical demonstration of the possibilities of the motor truck would 
result in increased sales. Often these ventures have proven so suc- 
cessful that they have become a permanent part of the farmers' busi- 
ness and would be conducted for profit even if the advertising value 
were nil. 



4 BULLETIN NO. JJO, U. S. DEPARTMENT OF AGRICULTURE 

(4) The city transfer companies, whose business permits them to 
undertake rural hauling. Most routes so developed are built on a 
sound basis. The companies, in most instances, develop their routes 
in districts familiar to them, where the opportunities for business are 
fairly well-known in advance. 

(5) The large corporation operating a fleet of trucks and com- 
manding considerable capital. There has been an increasing number 
of this class of operators, and the field has seemed attractive to many 
men of large capital. Profits during the war period have been such 
as to make it worth while for men of considerable means to devote 
serious attention to the building up of motor routes as a regular 
business. 

There are many and varied modifications of the above classifications 
of operators. Motor hauling during the emergency has been very 
miscellaneous in character, and conditions do not permit general state- 
ments to be made covering the field as a whole. With such an array 
in the field of motor hauling, it would naturally be expected that there 
would be a very wide range of operating conditions. Investigations 
have shown that this is actually the case. Certain weaknesses in the 
rural motor truck industry have been noticed in connection with these 
studies, and it is the purpose of this publication to call to the attention 
of operators and prospective operators those features of the industry 
which apparently are not understood or appreciated. It is hoped that 
some of the suggestions contained in this publication may assist in 
avoiding loss and in helping in the development of the rural motor 
route on a sound business basis. That rural motor routes in general 
are not being so developed is evidenced by the unbusinesslike methods 
adopted by many new operators, including both farmer-operators and 
the strictly commercial organizations. Present efforts to stimulate 
the motor trucking industry on the part of those who would profit 
more by its expansion evidently are not a part of a systematic or well- 
conceived plan. It is easy to call to mind conditions under which 
motor truck operation in certain rural districts as a regular business 
proposition has not proven profitable. These limiting conditions have 
not received the attention that their importance would warrant. The 
suggestions on the following pages are designed not so much to give 
specific instructions on the formation of new rural routes as to call 
to mind those business arrangements which must in all cases be con- 
sidered carefully if a venture is to prove profitable. It is hoped that 
this publication will assist in developing the proper sort of thinking 
among prospective operators and call up in definite order those basic 
considerations which must be given attention. The suggestions and 
conclusions included herein have resulted from a careful study of a 
large number of typical motor express routes in various sections of 



MOTOR TRANSPORTATION FOR RURAL DISTRICTS 5 

the country. In addition, the Bureau of Markets has been instrumental 
in establishing motor service in various districts during the early part 
of 1 91 8 and the methods adopted and the difficulties encountered have 
furnished material for a fairly comprehensive viewpoint on the en- 
tire problem. 

Inquiries are constantly being received regarding the practices and 
methods of successful operators of rural truck routes. It is a regret- 
table fact that there are practically no rural truck operators whose 
general plans are worthy of study by less experienced operators. Most 
rural routes are in the formative stage. For this reason it is felt that 
a summary of the problems of all will be of mutual interest both to the 
present operator and to the prospective one. The usefulness of the 
motor truck for the individual farmer will not be dwelt upon in this 
bulletin, but we will concern ourselves entirely with the possibilities 
of the motor truck as a community transportation feature. 

PRELIMINARY SURVEY OF THE FIELD OF OPERATION. 

Too many beginners delay a canvass of their field of operation until 
they are definitely committed to the establishment of a motor route by 
an investment of funds. Such a beginning is decidedly an unwise one. 
Many an optimistic viewpoint has been changed by a closer scrutiny 
of the business essentials which must be considered when a rural route 
is established. It is very desirable, in fact almost necessary, that a 
thorough business survey be made in advance by the prospective 
operator. In the first place, an investigation may disclose the fact that 
it is unnecessary or undesirable to start the route at all. Secondly, a 
proper investigation may materially modify preliminary plans, par- 
ticularly with respect to the investment of funds and the selection of 
equipment. Enthusiastic but inaccurate reports which have been given 
wide circulation in many districts, have been responsible for some 
amateur beginnings which should never have been undertaken. The 
motor route which has a chance for success must be founded on a 
careful business analysis of the field of operations. 

There are four important factors which must be given consideration 
by the beginner in the field of rural motor transportation. These four 
factors are : ( 1 ) The volume of farm products produced along the 
contemplated route; (2) the volume of miscellaneous hauling which 
could be secured to supplement regular loads; (3) competition from 
other carriers which would be encountered ; (4) the character of the 
highways over which the trucks must run. It may safely be said that 
the features mentioned above will ultimately determine the success or 
failure of any rural route. 

A motor route established in a sparsely settled or non-productive 
region is foredoomed to failure. A little thought will make it clear 



6 BULLETIN NO. JJO, U. S. DEPARTMENT OF AGRICULTURE 

that a potential supply of commodities must be available for hauling 
if there is to be sufficient business to make the route a paying one. 
Secondary only to the total supply is the question of the character of 
production. A region devoted to the production of a few staple crops 
moving to market during a comparatively brief season each year will 
not furnish business for a permanent route. A necessary prerequisite 
for successful operation is a reasonably dependable tonnage through- 
out the year. For this reason it follows that the range of the shipping 
season is of primary interest to the truck operator. Regions of 
diversified farming, particularly those regions devoted to truck farm- 
ing, offer the most fertile fields for rural motor transportation. In such 
districts shipping starts early in the season ; new crops are periodically 
available for market, and the productive season usually extends to the 
limit set by climatic conditions. Districts devoted to the dairy industry 
are also potentially rich fields for the motor truck operator since 
dairying furnishes a dependable and reasonably uniform supply 
throughout the year. This permits the establishment of a fairly regu- 
lar routine on the part of the truck operator and to that extent 
renders easy an efficient and economical conduct of his business. 

Consideration should also be given to the nature of the products 
that will be hauled. Low-priced, bulky staples may not stand the 
transportation charges necessary to maintain a motor route. For 
example, it is rather unlikely that hay can be transported by motor 
truck for long distances except under unusual conditions with respect 
to price. Perishables may stand the motor truck tariff if the trans- 
portation service to market is speedier than the customary means of 
transportation. Commodities like cream, milk and eggs which are 
high in price as compared to bulk may bear a reasonably high trans- 
portation charge if more satisfactory facilities are offered. 

The question of supplementary business for rural truck operators is 
often an important one. The return load is discussed in a subsequent 
section of this publication. It is desired merely to take occasion at 
this point to direct attention to possible side lines of operation which 
have been responsible for the final financial success of some routes. 
Arrangements for special hauling outside of the regular schedule are 
often an important source of income to the rural motor truck operator. 
Some have found it profitable to care for the tonnage offered by indus- 
trial enterprises in their districts. Others do special hauling for farmer 
patrons outside of regular hours. Usually the operator of a general 
route secures some profitable business from merchants along the route. 
These possibilities should be canvassed in advance as their presence or 
absence may determine the feasibility of the route. Above all, atten- 
tion should be concentrated on the problem of arranging for loads so 
that there is a profitable load on all trucks whenever they are operated. 



MOTOR TRANSPORTATION FOR RURAL DISTRICTS 7 

Competition is as important a feature as in other business. The 
motor operator may find it necessary in some cases to compete with 
express companies, ra'ilroads, electric interurban lines, boat lines, or 
other truck operators. It is a very unwise policy to ignore the com- 
petitor who is already in the field. Every producing district in the 
country has some sort of arrangement to provide for transportation 
to market. The wise beginner in the motor truck field will make a 
survey of existing transportation facilities in advance. He will make 




Fig. 2. — Celery in crates is easily carried in most kinds of trucks. 

a special effort to foresee the conditions under which the motor truck 
would fit into existing schemes of transportation. In considering 
competition, particular attention should be given to rates, schedules 
and delivery arrangements. These are the factors on which the motor 
truck must stand or fall so far as concerns competition with other 
transportation agencies. Some operators have found it possible to 
compete successfully with rail service and to charge rates rather 
higher than were charged by the customary carriers. Such a condition 
is possible only where the truck operator is able to afford a superior 
service and in districts where patrons are willing to pay a premium 
for such superior service. Delivery arrangements have always offered 
a certain amount of trouble to rail carriers and by effecting direct 
delivery from shipper to consignee with no intermediate delivery 
charges, the motor truck has been enabled to compete successfully 
with rail carriers whose rates are slightly less than those of the motor 



8 BULLETIN NO. 770, U. S. DEPARTMENT OF AGRICULTURE 

truck. Freight and express schedules in some districts have been 
unsatisfactory to the shippers and by offering a more prompt and 
speedy service, operators have often secured for themselves a very 
satisfactory tonnage that ordinarily would move by rail. 

Good roads are a prerequisite to successful motor truck operation. It 
is believed that few motor truck operators realize the increased ex- 
pense which results from travel on poor roads. The prospective 
operator who plans to move his truck along roads which are virtually 
impassable or at any rate unsatisfactory, will find that his daily operat- 
ing costs are far in excess of normal costs of operation, and this one 
fact alone will seriously affect his profits. A careful road survey will 
be made in advance by the businesslike operator. 

Enough has been said in the preceding paragraphs to indicate the 
general scope of the preliminary canvass which every prospective 
motor truck operator should make. The Bureau of Markets has made 
a fairly complete study of a large number of typical rural routes and 
has assisted in the establishment of several such routes. The points 
considered by investigators of this Bureau in making a preliminary 
canvass of the field of operation may be helpful to operators who 
contemplate such a study in their own territory. The following out- 
line was placed in the hands of each investigator, and the final report 
on the feasibility of establishing motor service in any district covered 
complete reports on each of the items in this outline. 

Roads. 

Character of surface. 

Grades. (As affecting motor hauling.) 
Location and Length of Proposed Routes. 

Terminals. 

Towns to be covered. (Distance apart, size, etc.) 

Total distance covered. 

Logical location for route headquarters. 
Principal Commodities to be Carried Each Way. 

Nature of agriculture along route. 

Commodities to be hauled each way in summer. In winter. 
Amount of Business Which Would be Pledged. 

What business would be pledged in summer? In winter? 

Estimated quantity of business by months. 

Of what would return load consist? 

Who would furnish bulk of business — farmers or country merchants? 

Do prospective patrons seem inclined to pledge business? 
Service Now Given by Other Carriers. 

What other carriers serve the territory? 

The maximum, minimum and average farm haul to loading stations. 

Schedule maintained by present carriers. 

How do present delivery arrangements compare with proposed arrange- 
ments if a motor route should be established? 

Rates charged at present. (Freight and express.) 



MOTOR TRANSPORTATION FOR RURAL DISTRICTS 9 

Schedule Which Should be Maintained. 

Number and capacity of trucks which probably would be needed. 

When would trucks leave terminals to best serve the territory? 

Probable running time over the route. 

How many stops should be made and where? 
Proposed Methods of Collecting and Delivering. 

At how many and at what points would loads be collected? 

How would transportation charges probably be collected? 

What delivery should be effected both at city and country points? 

Local Interest in the Enterprise. 

What persons or concerns are most interested? Why? 

Could private capital be induced to contribute toward an experimental 
service? 
Permanence of Proposed Route. 

Will territory support the proposed route when rail service is normal? 

Is there any reason why the route should not be permanently profitable? 

It rs manifestly impossible completely to outline an ideal investiga- 
tion which would be satisfactory for all districts. It is necessary to 
correlate the preliminary canvass with local conditions. The items 
enumerated in the above outline, however, may offer some suggestions 
which will be helpful to those interested in the establishment of rural 
motor transportation routes. 

ADVANCE ESTIMATE OF OPERATING COSTS. 

One of the first questions to arise in the mind of the prospective 
motor truck operator is : "What will it cost to operate a truck ?" Loads 
will be arranged, rates will be established, the route will be planned 
and the truck purchased on the basis of this estimated cost. If the 
business is to be intelligently planned, it is essential that some idea be 
secured in advance as to prospective operating costs. The importance 
of having an idea of these costs in advance can not be over-empha- 
sized. 

There are several sources of information which may be helpful to 
the man contemplating the purchase of a motor truck. Previous 
personal experience of the operator is exceedingly valuable. Experi- 
ences of other operators may often be secured for the asking. Motor 
truck manufacturers will be glad to furnish prospective purchasers 
with such information of this nature as may be available. Data 
secured from truck manufacturers very often do not indicate the con- 
ditions under which the figures were secured. Information thus 
offered is usually an honest attempt to aid buyers but almost invari- 
ably there is too much generalization to make such figures a very 
valuable basis of estimation. Many cost statements issued by truck 
companies do not take into consideration the varying classes of high- 
ways over which trucks run, variations in the load, total monthly or 
yearly mileage and other important factors. There is a tendency to 
submit data secured under unusual or ideal circumstances and thus 



10 BULLETIN NO. JJO, U. S. DEPARTMENT OF AGRICULTURE 

rendered valueless to the operator who must run his trucks under con- 
ditions over which he has little or no control. 

Several factors must be considered in arriving at reasonable cost 
estimates. Among them are: (i) size of truck, (2) probable loads, 
(3) daily mileage, (4) condition of roads, (5) cost of gas, oil and 
repairs. Large trucks necessarily involve increased expenditures for 
operation. The cost of operation per unit of load, however, may be 
less with the large truck than with the small one. The operator whose 
prospective daily mileage will be unusually large must expect that his 
operating costs will be correspondingly large. Where the roads are 
smooth and hard, costs of operation will necessarily be much less than 




Fig. 3. — An open-top stake body, with loose canvas cover, carries a large load of grapes, 
but is not the best type of body for hauling perishable products. 

where the roads are in a poor state of repair or so soft as to be nearly 
impassable at certain seasons of the year. Gasoline, oil and repair 
bills will vary in different sections of the country. It is impossible to 
generalize on these expenses at this point. The prospective operator 
must examine his local conditions, however, and adapt his ideas to the 
prevailing scale of prices. 

In view of the fact that no two individuals operate motor trucks 
under identical conditions, it is necessary that there be some basis of 
calculation applicable under all conditions. Calculations bearing on 
costs of operating motor trucks are customarily based on the "ton- 
mile." This expression refers to the transportation of a one-ton load 
for a distance of one mile, or the equivalent thereof. The use of such 



MOTOR TRANSPORTATION FOR RURAL DISTRICTS 1 1 

a basis is more nearly accurate than an estimation of costs on a mileage 
basis where no consideration is given to the load. It is obvious that 
the truck operating with no load, costs less per mile for operation than 
one that is loaded. The wise operator will keep this basis well in mind 
in considering his costs of doing business. 

Few motor truck owners foresee all of the cost items which will 
arise under actual operating conditions. Still fewer farmers, who 
have embarked in the motor trucking industry either as an individual 
enterprise or as part of a community effort, have a clear understand- 
ing of what factors must be considered in estimating costs of motor 
truck operation. Attention will be directed, therefore, to some of the 
more important items of cost. No attempt has been made to arrange 
these items in order of importance. 

GASOLINE, OIL AND GREASE. 

The costs of gasoline, oil and grease represent the first expense items 
which naturally occur to the mind of the prospective operator. The 
customary error made in considering them is shown in a tendency to 
emphasize unduly this character of expense. The cost of gasoline, oil 
and grease, of course, is dependent directly upon local prices. In some 
districts prices for these supplies are invariably higher than in other 
districts, and the prospective operator will naturally investigate his 
local market. The cost of these supplies is of course heavier when 
the motor truck is loaded and is one of the variable items of expense 
in motor truck operation which can be estimated with considerable 
accuracy. Most operators have a fair idea of the consumption of 
gasoline, oil, and grease by their own trucks. Operators who have 
had some experience in truck operation will find little difficulty in 
arriving at a reasonably close estimate of these costs. The data col- 
lected by the Bureau of Markets show a very wide range in the gasoline 
mileage for trucks of different sizes under varying conditions. A 
study of about 60 typical motor routes showed a mileage of from 

5 miles to 9 miles per gallon of gasoline for two-ton trucks, 4 miles to 

6 miles for three-ton trucks, and 3 miles to 5 miles for five-ton 
trucks. These figures are not conclusive but will serve to indicate a 
range which was found under actual operating conditions. 

DRIVERS' WAGES. 

The wages paid drivers vary in different sections of the country and 
for trucks of different sizes. In districts where the cost of labor is 
high, operators have found it necessary to pay relatively high wages 
for drivers. Information gathered by the Bureau of Markets on a 
number of routes indicates a daily wage range of from $2.75 to $7.50. 
The higher wages were paid for expert drivers of heavy motor trucks 
in industrial regions where the general scale of wages was high. Drivers 
of small trucks in general farming districts were content with the 



12 BULLETIN NO. JJQ, U. S. DEPARTMENT OF AGRICULTURE 

smaller wage. Where the truck owner expects to act as his own 
driver, it is only fair that a reasonable wage for this service be entered 
on the books before an attempt is made to calculate profits. 

DEPRECIATION. 

Depreciation as a feature of expense is little understood by the 
average small operator, and there is an almost universal tendency to 
accord too little consideration to this important item. Investigations 
disclose the fact that this constitutes one of the heaviest items of cost 
per mile of operation. Most operators who consider this item at all 
are inclined to set aside from 20 per cent to 33 1-3 per cent of the 
cost of the truck each year to cover depreciation. This is a very simple 
arrangement but it is not entirely a sound one. It is obvious that 
depreciation will be greatest on the truck which makes the greatest 
annual mileage. It will be seen, therefore, that unless the annual mile- 
age, or prospective annual mileage, is considered, the preliminary 
estimate of depreciation is apt to be incorrect. Depreciation under 
actual working conditions varies considerably with different makes of 
trucks and is correspondingly less on better makes. It is impossible 
to set forth a formula which will enable the prospective purchaser of 
a motor truck to estimate in advance his depreciation with any con- 
siderable degree of accuracy. It will be necessary for each owner to 
consider carefully his own conditions and on the basis of past per- 
formance of trucks of the same size and make as his own, draw his 
own conclusions. The operator who is just considering the route 
will do well to study very seriously the importance of this item of 
cost. If he will tentatively estimate depreciation in terms of dollars 
and cents per year, estimate his prospective yearly mileage, and divide 
his annual depreciation cost by the annual mileage, he will be sur- 
prised at the cost of depreciation per mile of operation. 

INTEREST ON INVESTMENT. 

While interest on investment is a matter of controversy in corpora- 
tion accounting there can be no doubt that the motor truck operator 
must give serious consideration to the fact that he will have invested 
considerable money in the motor truck that can not be used for other 
purposes. Most operators are content to estimate six per cent as a 
fair rate of interest per year, but few of them take into consideration 
the depreciating value of the truck. During its second year of opera- 
tion, it is obvious that the motor turck is not worth as much as during 
its first year. For this reason, a charge of six per cent for interest on 
the purchase price of the car is not a just one during the second year 
of operation. 

A simple formula has been devised by a conference of truck- 
owners for calculating the average annual interest to be charged 

against a motor truck. This formula is as follows : A + * x CXB 

a 2 _ 



MOTOR TRANSPORTATION FOR RURAL DISTRICTS 1 3 

average yearly interest. In this formula A represents the estimated 
life of the truck in years under actual operating conditions ; B repre- 
sents the original investment; and C represents the rate of interest. 
To illustrate the use of this formula let it be assumed that a truck is 
purchased for $3000 which the operator estimates will last for 4 years 
under his operating conditions. Six per cent may be considered a 
fair rate of interest. Inserting the necessary values in the equation 
given above, we have: ^-^ x - 06 X 2 S300 ° =$112.50 (average yearly 
interest). The use of such a formula makes it possible to estimate, 
with a reasonable degree of accuracy, the amount which should be 
set aside each year as interest on the investment. 

REPAIRS. 

The regular repair bill, when coupled with the annual cost of over- 
hauling, is often a serious one. The experience of motor truck opera- 
tors in various sections of the country show that this is an important 
item 'of expense. Naturally it is impossible to make an advance 
estimate of these costs with any reasonable degree of accuracy. The 
annual repair bill will bear a practical relation to operating condi- 
tions. Where care is used in handling the truck, the cost of repairs 
will be much less than where no attempt is made to exercise reasonable 
supervision over operation. The cost of repairs increases with the 
age of the truck. Those operators who have purchased used equip- 
ment have found their repair bills relatively higher. Repairs during 
the first year of life of the new truck are not a very serious considera- 
tion. When the motor truck is in more or less continuous use through- 
out the year, it is usually laid up once each year and given a complete 
overhauling. The cost of this overhauling depends on the age of the 
truck, the care which it has received, and its size. Data collected by 
the Bureau of Markets show annual costs of overhauling ranging from 
about $100 to as high as $800 or $900. Those truck operators who 
make it a point to keep their trucks in a constant state of repair have 
relatively small charges to meet for annual overhauling. Those who 
operate their trucks as long as possible with no regular repairs must 
often face an extremely heavy charge for overhauling at the end of 
each year. 

TrRES. 

Tire cost is another heavy item of expense. This item varies directly 
with the use of the truck. Road conditions are a prime consideration 
in determining tire cost per mile of operation. It is often found that 
there is a very wide variation in tire cost of different trucks operating 
with varying loads and under changing conditions. Data in the pos- 
session of the Bureau of Markets show a range of tire costs of from 
one cent to four cents per mile where solid tires are used. These 
figures cover a large number of trucks of different sizes, operating with 



14 BULLETIN NO. 7/0, U. S. DEPARTMENT OF AGRICULTURE 

different loads. They are offered as illustrative rather than as authori- 
tative. It must be remembered that while the actual tire cost of the 
large truck heavily loaded may be relatively high per mile of operation, 
the cost per ton may be small, and in the final analysis the latter com- 
parison is the only fair one. Where pneumatic tires have been used, 
it usually has been found that the actual tire cost is rather in excess of 
the cost where solid tires are used, but in such cases the annual depre- 
ciation and the cost of repairs are usually less. 

GARAGE RENT 

Garage rent is an item of expense which is often not incurred directly 
by the rural operator. Where the operator finds it necessary to rent 
garage space it is, of course, easy to calculate the cost. It is not so 
easy to make such an estimate, however, where no actual cash outlay 
is incurred. Where the operator is using garage facilities of his own, 
which might be valuable for other purposes, the rental value of these 
facilities should be entered on the books. Where no attempt is made 
to house the truck when not in use, the operator may save on garage 
cost only to lose a still greater amount due to increased depreciation. 

TAXES, LICENSE AND INSURANCE. 

Taxes and the costs of a license and insurance vary greatly in 
different states. The prospective owner of a motor truck should look 
into the matter in advance and be in a position to meet these liabilities 
as they come due. Insurance of various kinds must be considered. 
Theft, accident, and fire insurance should be taken out on the motor 
truck itself. Reliable operators now find it desirable to take out 
insurance covering the load which is being carried. 

OVERHEAD EXPENSES. 

The item of overhead expenses includes office rent, office equipment, 
clerical and other salaries, advertising, etc. They are often of minor 
importance to the farmer operator, but constitute a considerable ex- 
pense for the larger operator who finds it necessary to maintain a 
business headquarters. 

The above enumeration of operating costs may serve to call to the 
attention of some beginners in the field of motor truck transportation- 
the need for carefully considering the business elements in advance of 
actual operation. The most common error of the beginner is to under- 
estimate some of the cost items. Many beginners either underestimate 
or fail to estimate at all such an important item as depreciation. Such 
operators have been known to conduct their business for several 
months under the assumption that they were making money, only to 
find that their apparent net profit was being absorbed by the lessening 
value of their rolling stock. Other operators have been inclined to 
accept cost figures determined under widely different conditions, or 



MOTOR TRANSPORTATION FOR RURAL DISTRICTS 1 5 

under conditions which were not all comparable to those in the opera- 
tor's own territory. Few operators realize that costs are directly 
related to the plan of operation, and the final costs of operating a given 
route will depend almost entirely on the local conditions under which 
the route must be maintained. 

SELECTION OF OPERATING EQUIPMENT. 
The problem of selecting proper operating equipment is one that 
ordinarily is not given the consideration its importance deserves. Too 
few operators have a sufficient knowledge of the mechanical operation 
of motor vehicles, so that many a promising route has proven unprofit- 
able because of improper or insufficient mechanical equipment. In 
making their first purchases, some operators rely exclusively upon the 
statements of sales agents for motor truck companies. Often this 
procedure has proven satisfactory in the long run because as a rule 
the sales agent is anxious to see that his customer is supplied with the 
proper equipment, so that other orders may be expected in the future. 
It will be well, however, for the beginner in this industry to confer 
with owners and operators of motor trucks in his vicinity, who will be 
able to give him unbiased and unprejudiced advice. 

SIZE OF TRUCK. 

The size of the truck to be purchased will, of course, depend very 
largely on the estimated tonnage to be hauled. Not only must the 
operator purchase trucks of sufficient size to care for the business at 
the outset, but he must plan for a normal increase in tonnage, so that 
at a later date he will not find it necessary to purchase other equipment 
more suited to his needs. It. must be remembered that there is a very 
definite relationship between the size of the truck and its upkeep 
cost. The cost of operation per mile of a large truck is greater than is 
that of a small truck. If a large truck is purchased and the average 
load carried is well below the rated capacity of the truck, the operator 
will find that his cost per unit of load is high. On the other hand, 
where regular loads are uniformly heavy, the cost per unit of load is 
much less with the larger truck. One five-ton truck will transport 
a five-ton load much more economically than will two trucks of half 
that capacity. In some cases, consideration must be given to the 
character of the load to be hauled. If the load is perishable by nature 
and the truck is not loaded to capacity, the Comparatively heavy springs 
of the larger trucks may cause a deterioration of the load. If the load 
promises to vary considerably during different periods of the year, it 
may be advisable to consider the use of a trailer in connection with 
a truck of smaller rated capacity than the maximum load. The trailer 
seems to have been successfully used by a large number of commercial 
operators, but the Bureau of Markets has no data regarding the 
advisability of using trailers when the load is uniformly greater than 
the rated capacity of the truck. 



l6 BULLETIN NO. 770, U. S. DEPARTMENT OF AGRICULTURE 

Road conditions bear a direct relation to the size of truck to be 
selected. Roads having a light surface or country roads having a 
soft surface may not permit the operation of heavy trucks. In some 
states bridges in rural districts have not been designed to care for 
heavy modern traffic, and in these districts it is necessary to use 
lighter vehicles. Some States and some municipalities have placed 
legal restrictions on the weight of rolling vehicles passing over the 
roads. In most cases these restrictions are so worded as practically 
to forbid the use of trucks whose gross tonnage when loaded exceeds a 
certain maximum. In other cases the load which trucks may carry 
depends upon the width of the tire equipment. The prospective 
operator should communicate with the Public Service Commission or 
such other body as may have jurisdiction over the operation of trucks 
in his territory and inform himself in advance as to legal restrictions 
covering the operation of trucks on the highways. 

BODY EQUIPMENT. 

The selection of body equipment must be based primarily upon the 
general character of the loads to be hauled. In rare cases where the 
goods are highly perishable or must be carefully protected from 
weather conditions, it may be necessary to use specially constructed 
bodies. Under ordinary conditions, however, the operator usually has 
his choice of several types, and his selection, as a rule, is based upon 
his requirements and the initial cost of the equipment. 

Body equipment is usually secured from one of three sources. Bodies 
may be built locally, according to the ideas of the operator, and super- 
imposed on the chassis when delivered ; or, bodies of regulation design 
may be furnished by the manufacturer of the chassis as regular or 
special equipment. Some concerns specialize in building truck bodies 
according to regular or special designs and will furnish a body of any 
design submitted by the purchaser. 

Certain basic considerations are necessary in the selection of body 
equipment. The prospective operator should have a fairly clear idea 
of the general nature of the commodities which he will be obliged to 
haul. He should estimate the bulk of his load as compared to its 
weight. If any appreciable proportion of the ordinary load is perish- 
able, necessitating special protection from heat, cold, or rain, con- 
sideration should be given to this fact in the selection of a truck body. 
If the average load is to be composed of package freight, the truck 
body will be much different from the one used if regular loads are 
composed of commodities shipped in bulk. 

Of the large number of body types, many are entirely unsuited to 
the needs of the ordinary operator of a rural motor freight route. 
However, attention may be directed to a few of the more common 
types of bodies. While no uniform names have been applied to these 



MOTOR TRANSPORTATION FOR RURAL DISTRICTS 17 

general types, it is believed that the descriptions given herein will be 
sufficiently plain. The following are among the commonest types of 
truck bodies in use : 

Stake body (open top). — This is a relatively cheap body, is easy to 
load, and is capable of carrying extra large loads of bulky goods. 
Because of its construction, it is adapted to a large variety of uses. It 
should be remembered, however, that because of the open top and the 
lack of protection on the sides, it offers little protection from the 
weather unless the load is well covered with canvas. It is not always 
easy to protect the load by means of a loose canvas cover, and for this 
reason, the open-top stake body is not as popular for rural hauling as 
is the next type mentioned. 

Six or eight-post open-side body. — This body has a permanent water- 
proof top and, with the use of the customary side curtains, is a very 
popular and adaptable type. It is comparatively light in weight and 
offers much better protection to the load than does the open-top body. 
In winter, however, it is not easy to heat where it is necessary to pro- 
tect a perishable load. This type of body is the most popular because 
of its light weight, general adaptability and cheapness. 

Straight-side closed body (or van body). — This type offers the best 
possible protection to the load if it is so designed as to insure proper 
ventilation. It is possible to seal such bodies so as to protect the load 
from pilferage, this being a decided advantage where the load is a valu- 
able one. The closed body is heavy, thus increasing the cost of truck 
operation and is initially expensive. It is not so easily loaded as the 
open-top, but may be used for hauling almost anything that is offered. 

Open express body. — This body resembles the ordinary farm wagon, 
has no stakes at the sides, and is uncovered. It is well adapted for 
hauling milk or products shipped in bulk, such as grain. It is fairly 
cheap in price, but offers little or no protection from the weather. It 
is not adapted for hauling large loads of light bulky goods, and except 
for special purposes, should not be selected by the average operator. 

Dump body. — This is an unusual type for rural hauling and is not 
adapted to a wide range of uses. It is heavy, unsatisfactory, and 
expensive for general rural hauling. It might be used advantageously 
for handling bulk grain or similar products, but should be selected 
only for special uses. 

In general, the selection of body equipment is a problem which solves 
itself if proper forethought is given to the character of the business. 
There are many special variations from the general types of body 
mentioned above. If the prospective load promises to be heavy in pro- 
portion to its volume, the body need not be large. If, as is usual with 
miscellaneous farm loads, bulky loads may be carried, it is important 
that the body be of sufficient size to accommodate a capacity load 
for the truck. 



l8 BULLETIN NO. 7/0, U. S. DEPARTMENT OF AGRICULTURE 

TIRE EQUIPMENT. 

It is important that due consideration be given to the selection of 
tires, in view of the fact that tire cost is one of the heavy items in 
motor hauling. There are two general types of truck tires in use — 
the solid and the pneumatic. There is a third type, the cushion tire, 
which has a limited use at the present time, but by far the greater 
proportion of motor trucks are equipped with either solid or pneu- 
matic tires. The solid tire is more commonly used because it is more 
adaptable and cheaper than the pneumatic, does not suffer from blow- 
outs or punctures, and stands up well on bad roads and under very 
heavy loads. The pneumatic tire for truck use is a recent development, 
and there is less known about the possibilities of pneumatic tires for 
heavy loads than is known concerning the solid tires. Advocates of 
the pneumatic tire claim lessened vibration for truck and load, greater 
speed, and increased gasoline mileage. Where speed is essential, the 
pneumatic tire should be considered carefully. Where economy is the 
prime factor, the question is debatable. The majority of practical 
operators, however, favor the solid tire. No attempt will be made in 
this publication to issue an authoritative statement regarding the merits 
of the two types. 

The size of tires should depend upon two factors: (i) The weight 
of the ordinary load, and, (2) the character of the road. Under-size 
tires are not only uneconomical, but are injurious to the roads over 
which they travel. Over-size tires are initially expensive and, if the 
load is ordinarily light, are unnecessary. With slightly soft roads or 
extra heavy loads, over-size tires may be desirable. In general, the 
recommendations of the manufacturing company or its agents are 
more reliable than the judgment of an inexperienced operator. It is 
well for the prospective purchaser to consult local tire agencies in con- 
sidering new equipment. It should be remembered that the agent can 
offer authoritative advice only when he is fully informed as to operat- 
ing conditions, and when such advice is asked, the operator should 
state his case fully. 

DETERMINATION OF RATES. 

The Bureau of Markets has received many inquiries indicating that 
the question of a basis for the determination of motor freight or 
express rates is not clearly understood even by experienced operators. 
The operator of a regular commercial rural route (as distinguished 
from the farmer operating a truck for himself and a few of his 
neighbors) has little to guide him except the rates of other operators. 
As a rule, these are not sufficiently uniform to form an adequate or 
just basis of comparison. Many operators have established their rates 
on the basis of "what the traffic will bear." Naturally, rates so 
established have varied in different localities and for different com- 



MOTOR TRANSPORTATION FOR RURAL DISTRICTS 19 

modities. Many operators have initiated service with rates so high 
as to drive profitable business away; others have gone to the other 
extreme and in their desire to attract business, have failed to give due 
consideration to operating costs and have lost heavily because their 
rates were too low. There are several factors which should be con- 
sidered in the establishment of rates in any district. The value and the 
fragility of the load bear a direct relationship to the rate which should 
be charged. Very valuable or fragile loads involve a greater risk on 
the part of the carrier, and the tariff for the carriage of such goods 
should be sufficiently high to offset the risk involved. Where insurance 
is carried, this must be considered as an item of cost in calculating 
the rate to be charged. The length of the haul is naturally another 
prime consideration. It is comparatively easy to consider this item, as 
the cost, as a rule, varies directly with the distance. Road conditions 
also directly affect operating costs and, hence, must be considered in 
establishing rates. Where the roads are good, operating costs are low 
and charges for transportation can be lessened accordingly. Where 
poor roads are encountered, the additional cost must be featured in the 
rate schedule. The perishability and the bulk of the load also should 
be considered. The transportation of highly perishable goods involves 
a risk which must be paid for. Where goods are extremely light and 
bulky, it must be remembered that the truck when fully loaded may 
not carry its capacity in weight ; hence, operating costs will be increased 
per pound, and this must be reflected in the rates. Some operators 
fail to consider competitive rates by railroad, electric line, boat line or 
other motor truck lines. It goes without saying that a profitable busi- 
ness will not be secured if rates are not in line with those of other 
carriers. It should be remembered, therefore, that careful considera- 
tion must be given to rates charged by other carriers. The class of 
service rendered will also directly affect the rate. Where complete 
delivery is made from the door of the shipper to the door of the con- 
signee and service is rendered which is not duplicated by the railroad, 
the additional service must be considered in fixing the rate. In many 
cases rural motor routes make delivery of goods much more quickly 
than does the railroad, and where time in transit is a consideration, 
the additional value of such prompt service is to be considered. Return 
loads bear a direct relationship to the primary rate in that the operator 
who is assured of a profitable return load will be enabled to reduce 
his charges because of lessened cost per ton-mile. 

There are many other minor considerations to be gone over by the 
beginner in the motor truck industry, but those mentioned above are 
basic in nature. Some operators catering to a business which ordinarily 
would go by freight have established rates which compare directly 
with freight rates. Most operators do an express business and base 
their rates accordingly. In some districts, in the effort to establish a 



20 



BULLETIN NO. JJO, U. S. DEPARTMENT OF AGRICULTURE 



fair rate, motor operators have added ordinary freight and express 
rates together and divided the sum by two. This is decidedly an 
unsound and unscientific method for the determination of such rates 
but represents an earnest effort to place the motor truck on a rate 
basis comparable with that of the chief competing carriers. Practi- 
cally no rates have been established on the basis of cost plus a reason- 




Fig. 4. — The farmers of Harford County, Maryland, operate a motor truck route for 
themselves with entire success. This is one of their roadside loading platforms, to 
which the farmer brings his milk by a short haul, and the truck takes it to Baltimore. 

able profit. This is easy to understand because cost of operation is 
not well understood by most operators, and very few have any authori- 
tative information in this connection. 

The satisfactory rate must be one which is low enough to attract 
business and high enough to offer a reasonable profit to the operator. 
Where conditions do not permit the establishment of such a rate, care 
should be exercised in starting a route. As the rural motor business 
becomes more firmly established in various districts, the practical 
experience of operators will serve to indicate fair rate bases. In the 
meantime, it will be necessary for each operator to solve his own 
problems on the basis of local conditions in his district, paying par- 
ticular attention to the features indicated in this bulletin. 

COLLECTION AND DELIVERY ARRANGEMENTS. 

It must be remembered that that two of the principal advantages 
of the motor truck, namely, lessened handling of goods in transit, and 
speedier transfer, are lost if satisfactory collection and delivery ar- 



MOTOR TRANSPORTATION FOR RURAL DISTRICTS 21 

rangements are not perfected. It may be well to mention and to 
discuss briefly collection methods in vogue among practical operators 
in various districts. It should be stated in advance that no system 
worthy of exact duplication has been found by investigators of the 
Bureau of Markets in studying the business arrangements of a large 
number of operators in various sections of the country. Collection 
and delivery arrangements, as a rule, have grown up gradually with 
the business and in many cases are cumbersome, unsystematic and ex- 
pensive. The following common methods are suggested to prospective 
operators and may serve to stimulate thought in the direction of a more 
systematic handling of this phase of the motor-truck business. 

FARM-TO-FARM COLLECTION. 

Farm-to-farm collection usually is adopted on short rural routes 
where comparatively few stops are ordinarily made. Where heavy 
trucks. are used, this method of collection is not entirely feasible be- 
cause of the increased cost of operation. Where light trucks are used, 
however, it has proven reasonably satisfactory. One advantage of 
this method of collection is that the business of the operator is con- 
stantly brought to the attention of shippers along his route, and 
tonnage is thus secured which might otherwise move by different 
means. As has been indicated, farm-door collection is costly in time 
and gasoline, and the successful operator must charge rates which 
reflect his increased costs. In practically all instances it is not advis- 
able to deviate far from the main highway in collecting the load. Most 
operators who gather produce at the farm door refuse to go far from 
the regular route over which they ordinarily travel. 

CROSS ROADS COLLECTION. 

Collection at cross roads involves fewer stops than are made when 
the truck collects goods at each farmhouse and commends itself to 
the businesslike operator. Such an arrangement is convenient both 
for the patrons and for the driver. Of course, this method of collect- 
ing goods makes it necessary for shippers to bring their goods to the 
cross roads, but in most cases this can readily be done with the 
facilities at hand on the farm. This method of collection is very 
popular in various sections of the country and probably will remain 
a permanent feature of the rural motor hauling business in many com- 
munities. In general, it affords a maximum of service and convenience 
for a minimum of cost and comes nearer to fulfilling the ideal con- 
dition than any other method now in vogue. 

CENTRAL ASSEMBLING POINTS. 

Very few rural routes have their business systematized to the extent 
of arranging for central assembling points where shippers may bring 
their goods for transportation to the city. Where proper arrangements 



22 BULLETIN NO. JJO, U. S. DEPARTMENT OF AGRICULTURE 

are made, this method of collecting has much to commend it to the 
business-like operator. Where trucks of large capacity are used, the 
establishment of a few central assembling points will save operating 
the heavy truck in out-of-the-way districts and will materially lessen 
the cost of service to shippers. Two general methods may be used by 
the operator who desires to utilize central assembling points. The 
first method is to have the shippers bring their own products to the 
nearest central assembling point. In this respect, this system differs 
from the cross roads pick-up system only in that the number of stops 
for collecting loads are fewer. The second method is to arrange to 
have a lighter auxiliary truck to assemble all goods in a given district 
for loading on the heavy truck at the central assembling point or 
points. On one important demonstration route fostered by the Bureau 
of Markets, the first method of collection, i. e., with shippers bringing 
their own products to the central assembling point, was adopted. 
Later it was found more satisfactory to arrange for an auxiliary 
pick-up service, utilizing a lighter truck to pick up goods for as- 
sembling at central points to be loaded on the heavy truck for trans- 
portation to market. It seems altogether likely that with the enlarge- 
ment of rural motor service and the consequent systematizing of busi- 
ness, the central assembling point for gathering the load will grow in 
favor and importance. 

Whatever method of collection is adopted by the operator, it is 
advantageous to have a small loading platform at each point where 
goods are to be picked up. This loading platform should be the same 
height from the ground as the floor of the truck, so as to facilitate the 
loading of the goods on the truck. Such platforms are inexpensive 
and save much time and trouble when business is flourishing. 

DELIVERY METHODS. 

Methods of making delivery vary as greatly as do methods of 
gathering the load. These, again, are determined by the class of 
business handled, the type of the load, and the size and nature of 
individual consignments. It is impossible to generalize on the sub- 
ject in a publication of this kind, because satisfactory methods must 
be worked out on the ground so as to permit any changes which may 
be caused by local conditions. In many cases, and particularly by small 
operators, delivery is made directly to the door of the consignee. Where 
the business is on a large scale and is fairly well established, the 
operator often assesses an extra charge for direct delivery of packages 
which do not return a minimum gross revenue. This extra charge for 
complete delivery of small shipments varies from 25 cents to $2.00 per 
package. One large motor truck company operating in New York 



MOTOR TRANSPORTATION FOR RURAL DISTRICTS 2$ 

City delivers free of charge to any point below 120th Street individual 
consignments returning a gross revenue of $1.00 or more. Packages 
returning a lesser revenue are delivered free to the downtown terminal 
of the company only ,an extra charge being assessed for complete 
delivery to the consignee. 

Some rural operators have established city depots for the collection 
and delivery of goods. Commodities picked up at various points in the 
country are brought to these depots in the city. The consignee then 
calls for the goods, or a light truck for city use effects a complete 
delivery. In order, however, to utilize profitably the services of an 
auxiliary truck for city delivery, it is necessary for the operator to 
have a sufficient volume of business to justify the maintenance of such 
a vehicle. The establishment of a central terminal would solve the 
city delivery problems of the small operator. The central terminal 
plan is discussed in detail in a subsequent portion of this bulletin. 

Most operators have found it more satisfactory to make complete 
delivery to the consignee, assessing a minimum charge on small ship- 
ments sufficient to cover complete service. Such an arrangement is 
almost always more satisfactory to the patrons. Offering complete 
delivery also emphasizes one of the desirable features of motor truck 
service, namely, complete transportation service to the door of the 
consignee with a minimum of handling in transit. 

COLLECTION OF MONEY. 

Nothing has yet been said concerning the collection of moneys. 
With the small operator, particularly the farmer-operator, the collec- 
tion of money is usually a very informal matter. Cash is collected 
either from the shipper or from the consignee, according to previous 
understanding. Sometimes even the formality of a receipt is dis- 
pensed with. Where regular patrons furnish a dependable load, 
arrangements are often made for rendering weekly or monthly bills to 
these shippers. This necessitates more complete and careful book- 
keeping on the part of the operator, but is more desirable from point 
of view of the regular patron, who may not always have the exact 
change to hand to the truck driver when he calls for or delivers the 
goods. In any event, financial transactions should be marked by the 
passing of documents, whether these be receipts, receipted bills of 
lading, or other evidence that money has changed hands. 

KEEPING COST RECORDS. 

Having established a motor route, it is imperative that adequate 
records be kept. In an investigation covering over 60 routes, the 
Bureau of Markets found numerous instances where operators who 
thought they were making a profit as a matter of fact were gradually 
using up the original investment for current expenses. It is obvious 
that a man who has no clear idea of his costs of operation cannot 



24 BULLETIN NO. JJO, U. S. DEPARTMENT OF AGRICULTURE 

Form M. T. 1. U. S. DEPT. OF AGRICULTURE, BUREAU OF MARKETS. 

DRIVER'S DAILY REPORT CARD. 

Date 191 

Truck No 

OUTBOUND. 

Leave _ at A. M. 

P.M. 
Arrive „ at. A. M. 

INBOUND. P.M. 

Leave _ * at A. M. 

P.M. 
Arrive _ _ at A.M. 

P.M. 
Total mileage for day 

Total load outbound lbs. 

Total load inbound lbs. 

No. of delivery or pick-up stops 

Hours with helper cost 

Gasoline used gals. @ c 

Oil used pints @ c 

Grease used lbs. @ c 

Cost of repairs (if any) 

Time laid up for repairs hrs. 

Ferries and tolls 

Hours not running Reason 



I Front Ri ^ ht 
Tires Changed \ Lc ^" 



I Rear 

( 

Reasons for removal 



Right.. 
] Left.... 



Condition of roads.. 
Remarks 



Driver 

institute changes in business management which may be necessary or 
desirable from time to time. Investigators have found records of 
every sort, ranging from informal notes in a pocket note-book to 
elaborate auditing and accounting systems. The small operator is the 
chief offender in this connection, because he understands little of 
business records and is not disposed to add to his daily burden of 
work ; elaborate truck cost systems seem too complicated to him. The 
Bureau of Markets has placed some cost accounting forms with several 



MOTOR TRANSPORTATION FOR RURAL DISTRICTS 25 

co-operating motor truck operators, for the purpose of gathering data 
on costs of maintenance and operation. The forms may not have been 
ideal for the purpose, but a number of operators found, to their sur- 
prise, that keeping complete and accurate records was not the im- 
possible task which it appeared at first. It is not desirable to indicate a 
complete system of accounts in this bulletin, but the "Driver's Daily 
Report Card" on page 24 should prove a satisfactory basis for any 
permanent cost recording system. This form has been used successfully 
Jby the Bureau of Markets in cooperating with a large number of rural 
truck operators. It may not prove satisfactory under all conditions, 
but it is offered as a suggestion to those operators who desire to secure 
regular reports from their drivers each day. 

The information conveyed by the driver's daily report card, coupled 
with that in the hands of the owner of the truck, can be transferred to 
permanent records of a type desirable to the owner. Whatever system 
is adopted, this one fact must be kept in mind, that periodically it 
should be possible to balance all receipts against all costs, to determine 
profit and loss. Any system which will enable the owner to do this 
without too much effort can be used. 

UTILIZATION OF THE FARM TRUCK. 

There are an increasing number of farm trucks, particularly on 
farms adjacent to large cities. Not all these trucks are loaded to full 
capacity on their periodical trips to the city. Few farmers have their 
business so arranged as to permit the use of the truck to its maximum 
capacity regularly. Many farmers need a motor truck, in spite of 
the fact that they are unable to use it to capacity on a regular basis. 
Such farmers have gradually begun to haul a part or all of their 
neighbors' products to market and in some cases, this practice has led 
to the establishment of a regular route. Where the business has 
warranted, farmer-owners have increased their facilities for hauling 
goods, and many substantial rural routes are the outgrowth of the 
individual farm haul. Some farmers have been enabled to purchase 
trucks because of the fact that their own business, coupled with that 
of their neighbors', has been sufficient to warrant the purchase of a 
truck. It cannot be doubted that the motor truck as a community 
institution will be increasingly important. The farmer who is hauling 
for his neighbors is performing a useful function. Such practice is 
susceptible of expansion and the farmer-operator can usually offer 
attractive rates to his neighbors. Farmers needing a motor truck for 
part time service would do well to investigate the possibilities of 
business in their neighborhoods. It has been found in several instances 
that co-operative action has proven feasible and the subsequent forma- 
tion of a farmer's association has resulted. This feature of the motor 
hauling business is distinctly worth serious consideration by those 
who may be interested. 



26 BULLETIN NO. /"/O, U. S. DEPARTMENT OF AGRICULTURE 

THE RETURN OR SUPPLEMENTARY LOAD. 

The success or failure of many routes has depended largely on the 
ability of the truck owner to operate his truck at all times with loads of 
sufficient capacity to return at least a moderate profit. Too many 
routes have been started where a good one-way business was secured 
and the operator felt justified in returning with empty trucks. It is 
unsafe to generalize, but it may be definitely stated at this point that 
practically no route has ever been successful which has depended for 
its existence on a one-way load. Where truck operators have been 
farsighted enough to provide for even a partial load on the return 
trip, the business has offered a fair promise for success. Many of the 
more successful rural motor routes now in existence have achieved 
their success because of the fact that before operations commenced, the 
return load was arranged for. Those who contemplate embarking in 
the rural hauling business, would do well to look into the possibilities 
of securing contracts for supplementary or return loads, even though 
such contracts promise to pay little more than the cost of operating the 
truck. Most rural operators return from the city bringing back loads 
of general merchandise for country stores or supplies for farmers 
along the way. Where the operator makes it plain in advance that 
he proposes to cater to the merchant or farmer who makes his pur- 
chases in the city, he finds himself supported by a more or less perma- 
nent class of business which, while possibly not showing a very high 
net profit, makes it possible for him to handle his other business on a 
closer margin and with greater net profit to himself. 

In many districts there are certain periods during which there is 
a heavy local demand for transportation facilities. Truck owners nave 
taken advantage of this condition in many districts and have greatly 
improved the financial condition of their business. Special contracts 
for hauling outside of schedule hours are often exceedingly profitable 
and sometimes make it possible for the regular route to be operated 
regularly. 

In general, it may be said that too few operators realize the im- 
portance of utilizing their trucks to full capacity at all times, and 
many failures can be traced to the fact that operators have tried to 
secure all of their profits from a one-way business. 

THE CENTRAL TERMINAL. 

A noticeable feature of the operation of rural motor routes into and 
out of various cities, which came under the observation of investiga- 
tors of the Bureau of Markets, was the lack of central receiving or 
distributing stations. In each city the operators maintained their 
own individual stations and each carried on his business independent 
of the business of others. 



MOTOR TRANSPORTATION FOR RURAL DISTRICTS 



27 



Where a number of independent routes have their terminals in a 
given city, the over-head expenses incident to the maintenance of 
individual terminal stations are multiplied many times, while the 
advantages of a central terminal are lost altogether. These advantages 
are very real. In the first place, the establishment of a central terminal 
for a group of motor routes is in itself an advertisement of the service 




Fig. 5. — The peas in this load will go directly by motor truck to the dealer at the 
market 15 miles away and arrive in fresh condition. This is a concentration plat- 
form, to which perishable products are brought from all directions. 

in that the attention of the shipping public is directed toward the 
possibilities of motor transportation. The use of the central terminal 
encourages and facilitates the transfer of goods originating on one 
route and destined to some point on another route. The problem of 
city delivery, which is a serious one in large cities, can be solved by 
the establishment of a common delivery service, supported by all 
operators who use the central terminal, and obviating the need for 
operating heavy trucks to scattered points in congested districts for 
the purpose of delivering relatively small consignments. Last, but 
not least, the use of the central terminal would effect some very ma- 
terial economies on such items as office rental, clerical assistance, 
telephone charges, heat, light, and related expenses ordinarily incurred 
with the maintenance of terminal facilities. 

In view of these facts, the central city terminal is recommended to 
the consideration of groups of motor truck operators who maintain 
individual terminals. A central terminal company can possibly best 
be organized as a joint stock corporation. Expenses may be pro-rated 
on the basis of the volume of business transacted through the terminal 



28 BULLETIN NO. y/O, U. S. DEPARTMENT OF AGRICULTURE 

by each contributor to the enterprise. It is realized that competitive 
influences might offer obstacles to the plan indicated, but the operation 
of such a terminal as the one herein described could be made independ- 
ent of ordinary competitive factors. 

If the motor truck as a freight or express carrier is to compete 
successfully with other carriers who have occupied the field for a 
longer time, the business must be organized on a basis which will com- 
pare favorably with the business of older and better established car- 
riers. Central terminal facilities are just as necessary for motor routes 
as for other common carriers. 

BUSINESS ARRANGEMENTS FOR STABILIZING THE BUSINESS OF 
THE RURAL MOTOR OPERATOR. 

Mention has previously been made of desirable business features 
which should be incorporated in the practices of all rural truck 
operators. Among those mentioned were the determination of fair 
rate bases, the keeping of adequate cost and operating records, and the 
maintenance of dependable schedules. It is desired, in this connection, 
to direct attention to additional features which, if incorporated in the 
business of the rural motor operator, probably would do more to 
place the industry on a par with rail carriers than would any other 
changes which could be made. Reference is made to the use of a 
Standard Bill of Lading and the adoption of adequate insurance 
coverage. 

THE STANDARD BILL OF LADING. 

A satisfactory bill of lading should bind the operator to the obliga- 
tions of a common carrier and should set forth the extent of his 
liability very clearly. It should be designed so as to permit the trans- 
fer of goods from one carrier to another. In addition to the features 
of the ordinary railroad bill of lading, it should include some of the 
features of the invoice and the expense bill so as to obviate the need 
for a large number of forms for a relatively small business. The 
accompanying form for a Standard Bill of Lading is offered as a 
suggestion to operators who desire to standardize their shipping docu- 
ments. It will be noted that it is modeled, in a general way, on the 
ordinary "Uniform Bill of Lading," used by the railroads. Certain 
important changes have been made, however, to conform to the needs 
of the motor transportation business. The form contains certain 
items not ordinarily incorporated in the regular bill of lading, such as 
statements of value and shipping charges. While these are not a part 
of the ordinary bill of lading, it seems best to refer to the specimen 
document as a bill of lading, although it also includes the essentials of 
the invoice and the expense bill. It should be remembered that laws 
governing the business of common carriers vary in different States and 
in some cases it may be necessary to modify certain provisions of the 
suggested bill of lading to accord with existing laws. 



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MOTOR TRANSPORTATION FOR RURAL DISTRICTS 20. 

INSURANCE ON LOADS CARRIED BY MOTOR TRUCKS. 

The visible assets of the railroad, express company, or boat line 
offer assurance to shippers that the carrier is financially able to settle 
claims for damage to goods in transit. The operator of a motor route, 
particularly the small rural operator, can offer no such tangible evidence 
of his ability to meet obligations arising out of damages to goods in- 
trusted to his care. Until he can offer protection to his patrons, the 
motor operator must labor under a handicap. The obvious solution 
of the problem is to obtain adequate insurance coverage. Such in- 
surance should be for the full value of goods intrusted for shipment 
to the operator. The policy should cover all ordinary risks. Premiums 
should be paid by the operator from revenues derived from transpor- 
tation charges, unless the. value of the goods shipped exceeds a set 
maximum. *, 

Bearing these facts in mind, the following are offered as suggestions 
for provisions to be incorporated in a satisfactory policy : 

Provisions to be Incorporated in Policies Covering Shipments by Motor Truck. 

1. For account of as assured, or for 

account of whom it may concern, but warranted not to cover the interest of 
any alien enemies, including such persons, co-partnerships or corporations as 
now, or may hereafter appear in any Enemy Trading List issued by the War 
Trade Board of the United States of America. 

2. Loss, if any, payable to the assured or order. 

3. On all kinds of lawful goods and merchandise of every description held 
in their custody as warehousemen and forwarders, but only while contained in 
or on the following named and numbered automobile trucks. Whenever necessary 
and for such periods of time as shall be necessary, the assured shall be privileged 
to substitute any motor truck or motor trucks for those herein specified pro- 
vided the details of the proposed substitution are reported to the assurers in 
advance and an additional premium paid if required. 

4. It is the purpose of this insurance to indemnify the assured to the amounts 
which they are obliged to pay on such goods or merchandise by reason of loss 
or damage only by (1) fire, including lightning and self ignition; (2) accidental 
collision of the motor truck with any other vehicle or object, moving or sta- 
tionary; (3) overturning or skidding of the truck; (4) collapse of bridges; 
(5) perils of the seas, lakes, rivers or inland waters, only while on ferries or 
transfers; (6) theft of an entire shipping package or of over 5% of shipments 
made in bulk, but excluding all pilferage ; and excluding the theft by any em- 
ployee of the assured, or the shipper or his employee, or the consignee or his 
employees ; also excluding all theft of merchandise accepted for delivery within 
the limits of the city, town or village in which the goods are received for 
shipment. 

5. Valued at amounts declared by the shipper to the transportation com- 
pany, but not exceeding actual invoice value or, in the absence of invoice, the 
cash market value at time and place of shipment. In the event of the amount 
declared being less than the invoice or cash market value, as above, any 
partial loss shall be adjusted in proportion as the value declared bears to the 
invoice or market value. 



30 BULLETIN NO. JJO, U. S. DEPARTMENT OF AGRICULTURE 

6. It is understood and agreed that the assured shall keep a record of all 
shipments covered hereunder, showing shipping points, destination and value 
of each shipment, which record shall be made prior to shipment. It is also 
expressly understood and agreed that no insurance shall be in effect for which 
record is not entered on such forms as shall be prescribed by the assurer. All 
shipments to be reported to the assurers, or their appointed agents, at the end 

of each and premium payable monthly at the rate of 

per hundred dollars. 

7. This policy shall not be vitiated by any unintentional error in description of 
route or interest, or by deviation, provided the same be communicated to the 
assurers as soon as known to the assured and an additional premium paid if 
required. 

8. This policy to attach and cover on all shipments made on and after noon 

of 

9. If at the happening of any casualty, the assured or owner of the goods 
has any other insurance, identical with or similar to the terms of this policy, 
whether prior or subsequent thereto in date, or simultaneous with this in- 
surance, then these assurers shall not be liable under this policy for a greater 
proportion of any amount of the property insured than the amount hereby 
insured shall bear to the whole insurance in effect, whether valid or no". 

10. It is also agreed that the assured in claiming and accepting payment for 
any loss, damage or expense under this policy, thereby and by that act assig: s 
and transfers to these assurers all right to claim for such loss, damage or ex- 
pense against any person or persons, town or corporation or any government, 
and if so requested by these assurers shall prosecute therefor at the charge and 
for the account of these assurers, to the extent of the amount of the loss, 
damage or expense, and the attendant expenses of recovery paid and incurre 1 
by these assurers on account of said loss, damage or expense, or for the re- 
covery of the same, shall be a lien upon such property hereby insured and- 
recoverable against the assured. 

11. It is mutually agreed that the acts of either party, or their agents, in 
securing, preserving, or recovering the property insured or any part thereof 
shall not be considered as prejudicial to the interest of either party as set 
forth in this policy. The use of general terms, or of anything less than a 
distinct, specified agreement clearly expressed and endorsed in this policy shall 
not be construed as a waiver of any printed or written conditions or restrictions 
herein contained. 

12. This policy can be canceled at any time at the request of the assured 
or by the assurers by giving notice in writing at least fifteen days before such 
cancellation shall be effective. 

It will be noted that in using the standard bill of lading, the operator 
does not assume greater liabilities than those imposed by law on com- 
mon carriers. Adequate insurance coverage, in turn, will protect the 
operator who assumes such liabilities. The reporting form of policy 
outlined above is probably the best form for the average operator in 
that all goods, while in his possession, are insured for full marker 
value and settlement is made on that basis. The reports referred to in 
Section 6 of the above policy provisions would be nothing more elabo- 
rate than carbon copies of all bills of lading issued by the carrier who 
takes out this form of insurance coverage. Should State legislation 



MOTOR TRANSPORTATION FOR RURAL DISTRICTS 31 

covering the business of insurance companies be in contravention of 
any of the suggested policy provisions, it will be necessary to modify 
the language of these provisions to accord with the statutes. 

The use of the standard bill of lading and the adoption of the fullest 
form of insurance coverage are strongly recommended even to the 
small operator. Most operators will prefer to offer free insurance to 
the shipper on all goods valued below a certain maximum. It is sug- 
gested that a fair maximum for free insurance is about 50 cents per 
pound. When goods are valued at more than 50 cents per pound the 
shipper should, in addition to the regular shipping charge, be obliged 
to pay for the insurance coverage on the valuation in excess of 50 
cents per pound. A scrutiny of the clause near the bottom of the 
standard bill of lading will make this point clear to the reader. 

Only by the adoption of modern business methods can the future 
of the motor express business be assured. Many operators will hesi- 
tate to adopt the two important features, which have just been dis- 
cussed, because they will fear complications in their business and the 
assumption of too great a burden of detailed clerical work. Business- 
like operators, who have given these features a thorough trial, have 
been surprised at the ease with which they have been able to accommo- 
date their business to these changes. The small operator will find that 
the slight extra burden of work which he is assuming will be more 
than paid for in the increased business coming from patrons who are 
confident that any losses will be promptly and properly adjusted. 

LIMITING FACTORS. 

The chief factor limiting development in the field of rural motor 
hauling is the cost of operation as compared with that of railroads, 
electric lines, and boat lines. Cost of operation offers a problem which 
can only partially be solved by the operator. Careful attention to 
effecting economies may offset this limiting feature to some extent, 
but in the main the operator can not change his costs of operation to a 
very marked degree. This means that he must plan his business so 
that in competing with other carriers he is not working on an unequal 
basis. He must cater to a class of business which will pay a small 
additional premium for better service. To supplement this he must 
offer a speedier, more dependable or more complete service. For 
instance, many operators are successfully competing with other car- 
riers whose basic expenses are lower because goods are picked up at 
the door of the shipper and unloaded at the door of the consignee with 
a minimum of handling in transit. 

The second important limit to the extension of rural motor hauling 
is the condition of the average country highways. Road conditions 
bear a direct relation to operating costs. In extreme cases bad roads 
may prevent the use of motor trucks at all. In other and more com- 



32 BULLETIN NO. 770, U. S. DEPARTMENT OF AGRICULTURE 

mon cases, poor roads may cause operating costs to be so high and 
truck operation so uncertain that the business is foredoomed to failure. 

A third limitation to rural motor transportation, which has come to 
light under actual operating conditions, has to do with the financial 
responsibilities of the carriers. This feature has been thoroughly dis- 
cussed in the paragraphs referring to the use of a standard bill of 
lading and the securing of adequate insurance coverage. The limita- 
tion is one which need cause no fear to the business-like operator who 
is willing to make the necessary changes in his business so that he may 
be on a par with other carriers. 

The limitations herein mentioned must be carefully considered be- 
cause they are real factors in actual practice. All can be met and 
solved by the business-like operator. It is to be expected that they will 
be solved as a better knowledge of the rural motor business is obtained 
and the possibilities of this form of transportation become more 
apparent both to the operator and to the prospective shipper. 

CONCLUSIONS. 

The foregoing discussion, although general in character, has been an 
attempt to bring forth one thought, viz ; that under proper conditions, 
and where a fair knowledge of the limitations and difficulties obtains, 
motor truck transportation promises to play an important role in 
rural districts. 

Mechanically, the experimental stage for the motor truck has passed. 
Its worth and its efficiency have been demonstrated very thoroughly 
under the most trying circumstances. 

As operating equipment in a regularly established transportation 
business, where the financial difficulties faced by the ordinary common 
carrier are in evidence, the motor truck may still be considered as in 
the experimental stage. The problem of lifting it from this experi- 
mental stage is one that depends for its solution on careful planning 
and good business judgment rather than on greater mechanical per- 
fection of the truck itself. 

If the prospective operator can force himself to consider his motor 
equipment as merely a means toward an end, and will devote himself 
to a consideration of his business problems, his chances for success will 
be increased manifold. The motor truck as a common carrier has 
come to stay, but the measure of success for the individual will 
depend, as in other lines of business, on initiative and a proper sense 
of business proportions. 



